To let shoppers access clothing for a fixed fee on a monthly basis, American Eagle Outfitters is testing out an American Eagle Style Drop subscription offering. Customers can have “unlimited access” to clothing, according to Chain Store Age.
With the subscription, shoppers can look through selections that get refreshed on a weekly basis. Those items are mailed at no cost. To send an item back to the retailer, they can use a free prepaid envelope. In addition, shoppers can send back their items to be cleaned, and they are brought back to the customer without a fee. They can also cancel at any point.
Shoppers are told by The Style Drop website that they have to pick eight items at a minimum in order to have a box sent to them, but the site recommends selecting 20 pieces at the least. In addition, shoppers can rank their favorite choices, and the site will aim to mail out those selections before the others.
In a January forecast, Canaccord Genuity Consumer Analyst Camilo Lyon said, according to the outlet, “In our opinion, subscription models, if successful, are the holy grail, largely due to the predictability of cash flows, low incremental expenses and greater customer loyalty, which in turn translates into higher multiples paid to these models.” However, Lyon cautioned that “most will fail because their relationship with their consumer is likely based on discounting.”
Dozens of fashion and fashion-adjacent companies have dipped their toes into the market for subscriptions. Jewelry subscription company Rocksbox has raised $8.7 million, as clothing rental company Le Tote has raised $15 million for its venture. Another player, Golden Tote, delivers clothes, jewelry, shoes and other products to subscribers. And, per some reports, the digital clothing rental services market was worth roughly $1 billion in 2017. In addition, it is expected to have a compound annual growth rate (CAGR) of 10.6 percent from 2017 to 2023 to arrive at a value of $1.85 billion.